New Tax Credit Legislation Introduced

September 18, 2012

The Window and Door Manufacturers Association is applauding the recent introduction of legislation in the U.S. House of Representatives that would restore 25C tax credits for energy efficient windows and other home improvements. The Home Energy Savings Act (H.R. 6398) was introduced by Reps. Jim Gerlach (R-Pa.) and Richard Neal (D-Mass.), and would make the credit, which expired at the end of 2011, permament for the first time.

"The 25C tax credit stimulates job creation in the vital manufacturing and construction industries and leads to reduced energy consumption for home owners," says Michael O'Brien, WDMA president. "It has a proven record and helps homeowners of existing homes afford higher efficiency products such as windows, doors, and skylights."

According to WDMA, the new bill would initially extend the credit at the 2011 levels of 10 percent (up to $200) for windows and skylights and 10 percent (up to $500) for doors through 2013. Beginning in 2014, the credit would expand to 10 percent (up to $1,000) for all qualifying products, including Energy Star windows, doors, and skylights. Labor costs associated with the installation of windows, doors and skylights would also be eligible for the credit for the first time beginning in 2014.

The House bill follows similar efforts in the Senate. In August, the Senate Committee on Finance passed a bill that would extend the 25C tax credit at the 2011 levels through 2013, WDMA reports.

WDMA has made H.R. 6398 a top legislative priority and is working on passage of the legislation. "The window and door retrofit market has been key to sustaining the industry and preserving jobs during the prolonged housing downturn, and we appreciate the work of Reps. Gerlach and Neal in introducing this legislation," O'Brien states.

Internal Revenuse Service data shows the 25C tax credit helped Americans invest $25.1 billion on remodeling and efficiency upgrades in 2009, WDMA reports. That year, 67 percent of taxpayers claiming the credit had an adjusted gross income of under $100,000. In addition, according to analysis from the National Association of Home Builders, in 2009 the program supported 278,610 jobs, approximately $13.2 billion in wages, and $7.5 billion in net business income.